The Big Bank Theory

by Nireka Dalwadi

Bank Mergers, Neobanks, UPI and New Motor Vehicle Rules.

What’s happening this week?


ISRO continues to connect with Chandrayan 2 Vikram Lander and Jack Ma does a moonwalk at his retirement event.

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Honk Honk

Risk on the Road, Hole in the pocket… The Motor Vehicles (Amendment) Bill, 2019 came into effect from 1st September 2019. The revised bill was based on the recommendations of a group of transport ministers of states. The highlight is the hefty fines are imposed on traffic offenses. The new act extended the period of renewal of the driving license from 1 month to a year from the date of expiry.

To each their own… the states can reduce the penalty amount under the new Motor Vehicle Act. Gujarat reduced the fines up to 90% citing humanitarian grounds, various other states are planning to follow slashing the penalty amounts.

Crossing the ITR due date… 31st August 2019 was the due date when tax audit is not applicable. Missed filing your ITR? You can still claim the eligible tax refund by filing a belated return. The amount for the penalty for late filing of ITR u/s 234F is:

In case, a tax audit is applicable to you, the due date is 30th September 2019.

Get CA assisted ITR filing with Quicko and get the maximum refund.

Banking on it

The Big Grand Indian Banking… The FM Nirmala Sitharama announced the merger of 10 state-owned banks and thereby creating 4 large banking entities. Earlier this FY Bank of Baroda was merged with Vijaya Bank and Dena Bank. The government is looking to improve operational efficiency following better lending at a lower cost expected after the merger.

In talks… Paytm, India’s leading payments platform is likely to buy a stake in Yes Bank. Amidst the reports on the stake sale, the struggling Yes Bank rejoiced on the stock exchange as their shares rally over 15%. This is expected to mold as per the RBI approval. If the deal materializes, it would be the first time an online payment platform acquires a significant stake in a bank.

Fintech Newbie… Neobanks is a kind of digital bank and does not have any physical branches or bank licenses. They count on bank partners to provide bank licensed services. Neobanks offer services like money transfers, mobile-first or digital financial payments solutions, money lending, etc. Similar to traditional banks, these Fintech platforms earn margin between money inflow and lending. Neobanks have been successful in the west, but, is a new concept in India. Open, 811 by Kotak, Yono by SBI, NiYO and InstantPay are some players in India.

High on UPI… The Unified Payments Interface or UPI has catered to a record high of 90 crore transactions in August 2019. UPI is now one of the most used digital payment options. After its launch in August 2016 with 21 banks, and has grown its base to nearly 120 banks today. Google Pay is leading the UPI race followed by PhonePe.

The glass is half empty… bad loans, mounting NPAs, low cash and slow loan growth in India’s banking system are still a major concern. But Banks are merging, Payments are getting simpler and online-only banks emerging… Finance in India is revolutionizing. How exciting is that?!

Byte of the Week

Millennials’ preferrence for Ola, Uber is affecting auto sector” — Nirmala Sitharaman


🔥 How Flammable?


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